Review of the Literature 8 Statement of Objectives 24 Following Chapters 27 CHAPTER II. THE BASIS FOR A THEORETICAL MODEL THAT 29 ALLOWS FOR DIFFERENTIAL TREATMENT OF COOPERATIVE MEMBERS Patron Homogeneity 29 Methods of Applying Differential Treatment 34 Feasibility of a Cooperative Using Differential 35 Treatment Legality 35 Adherence to cooperative principles 37 Acceptance by members 53 CHAPTER III. DEVELOPMENT OF THE ECONOMIC MODEL 57 The Individual Producer Objective (profit) function Constraints (production function) Lagrangian function The Cooperative Production-pricing objective (profit) function 70 Production-pricing model constraints Determination of net savings 74 Production-pricing model Lagrangian 77 Financial model objective (profit) function 77 Financial constraints Financial model Lagrangian function iii CHAPTER IV. ANALYSIS OF THE THEORETICAL MODEL 84 Individual Patron Model 84 Production-Pricing Model 88 Financial Model 101 CHAPTER V. APPLICATION OF THE THEORETICAL MODEL Procedure Used for the Specific Model 117 Formulation of a Computer Simulation Model 118 Formulation of the Computer Model 137 Application Results 138 Base model 138 Differential treatment models 140 Other potential models 152
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